Islamabad, March 24, 2025 – The Federal Board of Revenue (FBR) is considering a fresh approach to ensure that retailers and shopkeepers comply with tax regulations.
This move comes after the failure of the recently launched Tajir Dost Scheme, which was unable to bring a significant number of retailers into the tax net.
According to FBR sources, the tax authority is now evaluating the possibility of launching another registration initiative targeting retailers and shopkeepers. This new scheme is expected to be part of the federal budget 2025-26, as the FBR aims to enhance tax collection from the retail sector.
Despite these efforts, industry leaders argue that existing tax provisions should be enforced before introducing a new scheme. Muhammad Naeem Mir, chief coordinator of the Tajir Dost Scheme, emphasized that with the inclusion of Section 236G and Section 236H in the Income Tax Ordinance 2001, there is no immediate need for an alternative initiative.
Under Section 236G, advance tax collected on purchases from manufacturers and importers was reduced from 2% (non-filer rate) to 0.1% (filer rate). Similarly, Section 236H, which applies to sales made to retailers by manufacturers and distributors, reduced the tax rate from 2.5% (non-filer) to 0.5% (filer).
Naeem Mir highlighted that non-filers still face higher tax rates of 2% and 2.5% under Section 236G and Section 236H, respectively. He urged the FBR to use data from these sections to enforce return filing from unregistered retailers, rather than introducing new compliance mechanisms.
The FBR had initially estimated Rs 50 billion in revenue from the Tajir Dost Scheme, but experts believe that better enforcement of existing tax laws could yield even higher collections.
So far, the FBR has successfully integrated 9,834 large retailers into the Point of Sales (POS) system, ensuring proper documentation of sales transactions. This includes 738 restaurants and 506 textile and leather retailers registered under the system.
By focusing on Tier-I retailers, the FBR aims to strengthen compliance, though small shopkeepers are currently not a priority. As tax authorities refine their strategy, retailers remain at the center of efforts to enhance documentation and improve revenue collection.